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Book Review December 25, 2007
 
Naomi Klein Takes Down The Shock Therapy Quacks
By Alexander Zaitchik Browse author Email
 
Page 2 of 4
 

Klein presents a queen's ransom of research and reportage to back up her thesis. She details how in the countries of the Latin American cone, neoliberal shock-therapy was administered only after coups and terror campaigns had weakened or destroyed the popular will and ability to resist. In Poland and Russia, radical free-market reforms were imposed by rapid-fire diktat after the shocking and disorientating collapse of communism, which left publics too dazed, uncertain, and indebted to insist upon remaking their economies according to, say, Solidarity’s vision of workers' cooperatives. In the cases of Poland and Russia, western-advised governments asked the public not only to abandon more populist paths of post-communist development, but to hand over their newly won democratic rights to those who knew best—the western shock docs. 

In Poland, the “democracy-free moment” in which shock-therapy was administered ended with the downfall of Solidarity and a change of direction. In Russia, an opposition parliament similarly tried to reassert control, but failed. Instead, it was dissolved and shelled by Yeltsin’s tanks. In both cases, Klein shows, neoliberal reform was democracy's nemesis. 

Poland was the first post-communist state outfitted for a Milton Friedman-designed electrode hat. It was a strange honor, considering the Solidarity movement began as a socialist revolt along the lines of Charter 77’s desire for “socialism with a human face.” Solidarity’s own slogan was, “Socialism—Yes; Its Distortions—No.” Uniting the movement wasn’t just a hatred of atheistic Russian rule, writes Klein, but a positive “radical vision for huge state-run companies…to break away from governmental control and become democratic workers’ cooperatives.” 

But it wasn’t to be. The Solidarity government inherited enormous communist-era debts and a ruined economy; it needed help. Sensing opportunity in Poland’s crisis, the IMF and U.S. Treasury failed to offer Lech Walesa and his fellow union men-turned-politicians much assistance—the initial package was $119 million and a note of congratulations. That changed only after the Polish government agreed to be strapped to the gurney and bite a plastic bit while a few hundred volts coursed through its economy. 

The man who flipped the metaphorical electricity switch on Poland was 34-year-old Harvard economist Jeffery Sachs.

Sachs arrived in Poland promising to deliver western aid to the Solidarity government in exchange for abandoning everything they believed—and had promised the Polish people. At first, Walesa and his colleagues were interested in hearing what Sachs had to say. But when he presented his shock-therapy program to the Solidarity leadership, it was aghast. After a bitter internal debate, the Solidarity leadership ultimately agreed and asked their supporters to join them in biting on the plastic bit. Poland proceeded to enact the policies called for in the Sachs plan: rapid privatization, cuts in subsidies, price liberalization, etc. The result was an almost immediate deepening of mass misery and a huge spike in strikes—from 250 at the beginning of the plan to 7,500 two years later. Solidarity was voted out of office in 1993, with Adam Michnik famously muttering, “The worst thing about communism is what comes after.”

Like the leaders of Solidarity, Mikhail Gorbachev also came in for a rude awakening. At the 1991 G7 meeting, donor countries, led by the U.S., told the embattled Soviet president that there would be little aid on offer unless he embraced radical free-market reforms that bore no resemblance to his plans for transforming the Soviet states into Scandinavian social democracies. When Gorbachev hesitated, his usefulness was suddenly and violently called into question by elite western media, enamored with the newly christened “Washington Consensus.” Klein’s collection of newspaper clippings from this period makes for interesting reading in light of current Western condemnations of Putin’s managed democracy. The Economist, today so hypersensitive to the health of Russian democracy, in 1990 urged Gorbachev to adopt “strong-man rule” and imitate Pinochet, even if it involved “blood-letting.” The Washington Post likewise supported the idea of a coup and thought Russia needed a “despot [like] Pinochet.” So much for Gorby Fever. 


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Zaitchik
Browse author
Alexander Zaitchik is an editor at The eXile. Email him at zaitchik@gmail.com
 
 
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